Sir Pipsalot's Wednesday Market Update 03-24-2010

The EUR/USD sell I called in yesterday's signal has worked well and is up about 90-100 pips right now. Short term I've shifted to a bit more of a neutral stance and have tightened the SL on the remaining 1/2 position to about 1.3530 and am trailing it manually a bit behind the 60 sma on the 1h chart. My final TP is about 200 pips because I don't want to push it too far when I'm trailing my SL like this.

EUR/USD is at a line in the sand here with big support in the mid 1.3400's. It's possible we break out low here, but it's also possible we continue to flatten out for awhile longer with another rally leg off this support playing the recent range up to yesterday's sell zone of 1.3540-1.3570... I'm in wait and see mode today for market direction and probably will wait until after today's action to plan my next move on the Euro.

Stocks have managed new recovery highs highlighting why I'm staying out of the short side until we have more concrete confirmation of a more substantial selloff. The next chance for a riskier (but high profit potential) short would be after minor confirmation from a break of 1159 on ESM0 (S&P 500 futures), but the more solid confirmation I'm looking for still seems to be a break of 1136.

In news Tuesday, we saw UK CPI come in low, but not quite low enough to hit our sell triggers; however, we still saw about 40 pips down, a hard retrace, and resumption downwards in the 40-50 pip range 40 minutes later. US Existing Home Sales came out too close to expectations for a trade. In news Wednesday:

0428 German Manufacturing PMI - This is not usually a big mover, but with Europe still in the spotlight, we could see a bit of a churning trend result from this if there was a large surprise.

0830 US Core Durable Goods (0.4% expected) - This trade has been a decent mover good for 30-50 pips depending on the conditions at the time of the report.
If it comes out at 1.9% or higher, USD/JPY should rally 30-50 pips.
If it comes out at -1.1% or lower, USD/JPY should fall 30-50 pips.

1745 NZ GDP q/q (0.8% expected) - This number is also usually good for 35-50 pips or so and the release time of 1745 makes it a little friendlier than last quarter's release.
If it comes out at 1.0% or higher, NZD/USD should rally 35-50 pips.
If it comes out at 0.6% or lower, NZD/USD should fall 35-50 pips.

That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only. If you have any questions, you can also email me at sirpipsalot@profitmongers.com

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